A variety of methods are used in econometrics

Econometrics

Econometrics has been defined as "the application of mathematics and statistical methods to economic data" and described as the branch of economics "that aims to give empirical content to economic relations." More precisely, it is "the quantitative analysis of actual economic phenomena based on...

 to estimate models

Model (economics)

In economics, a model is a theoretical construct that represents economic processes by a set of variables and a set of logical and/or quantitative relationships between them. The economic model is a simplified framework designed to illustrate complex processes, often but not always using...

 consisting of a single equation

Equation

An equation is a mathematical statement that asserts the equality of two expressions. In modern notation, this is written by placing the expressions on either side of an equals sign , for examplex + 3 = 5\,asserts that x+3 is equal to 5...

. The oldest and still the most commonly used is the ordinary least squares

Ordinary least squares

In statistics, ordinary least squares or linear least squares is a method for estimating the unknown parameters in a linear regression model. This method minimizes the sum of squared vertical distances between the observed responses in the dataset and the responses predicted by the linear...

 method used to estimate linear regression

Linear regression

In statistics, linear regression is an approach to modeling the relationship between a scalar variable y and one or more explanatory variables denoted X. The case of one explanatory variable is called simple regression...

s.

A variety of methods are available to estimate non-linear models. A particularly important class of non-linear models are those used to estimate relationships where the dependent variable is discrete, truncated or censored. These include logit

Logit

The logit function is the inverse of the sigmoidal "logistic" function used in mathematics, especially in statistics.Log-odds and logit are synonyms.-Definition:The logit of a number p between 0 and 1 is given by the formula:...

, probit

Probit

In probability theory and statistics, the probit function is the inverse cumulative distribution function , or quantile function associated with the standard normal distribution...

 and Tobit

Tobit model

The Tobit model is a statistical model proposed by James Tobin to describe the relationship between a non-negative dependent variable y_i and an independent variable x_i....

 models.

Single equation methods may be to applied time-series, cross section or panel data.